I wrote this post in my role as Executive Director of Sustainable SFU, an environmental not-for-profit working at Simon Fraser University. It originally appeared here.
On November 16th, thousands of Canadians will gather in nine cities to oppose runaway climate change and fossil fuel expansion. From the Pacific to Atlantic coasts, citizens will call on governments to defend our communities and maintain a safe and just climate for all generations. Many of those attending are also calling on their churches, pensions, schools and cities to end investment in businesses that damage the climate and threaten our communities.
Why should this matter to students at Simon Fraser University?
The Climate is Changing. So what?
The start of your fall classes marked the 343rd consecutive month of hotter than average global temperatures. If you’re younger than 28, that means you’ve never experienced a cooler than average month. This is because burning oil, gas and coal moves eons of stored carbon up to our atmosphere, where it then stays and holds more energy, warming our planet. If that just meant nicer weather, that would be a-okay. But a hotter atmosphere has serious impacts.
Impacts like extreme and unpredictable weather. This past June, my family were among those in Alberta hit by the costliest natural disaster in Canadian history. The Alberta floods killed four people and displaced over 100,000, at a cost of over $6 billion dollars. Hydrologists, climate scientists, the insurance industry and others have warned that our warmer planet is exacerbating dangerous weather and making it less predictable. Flooding hit Toronto, the UK and India this year, and Colorado was pummelled by a succession of extreme drought, wildfires, and flooding. Officials in the Philippines are blaming climate change for Typhoon Haiyan and demanding emergency action to reduce emissions and adapt.
And still, after you leave SFU, climate chaos will continue to exact a worsening toll in lives and dollars.
Aside from catastrophic weather, a leaked draft of the next IPCC report forecasts water and food shortages, disease and civil and inter-state war as a result of climate change. New pockets of poverty and worse inequality are expected in high-income countries like Canada. IPCC scientists expect the global economy to contract between 0.2 and 2 percent if we don’t reverse our warming trend.
Clearly, the climate situation has major implications for your life after graduation and the future of your career, health and family.
Unburnable Fossil Fuels
There is no question about why our climate is changing. With the same degree of certainty that smoking causes cancer, we are certain that burning fossil fuels like coal, oil and gas damages our climate. This is why Sustainable SFU has joined the global call for fossil fuel divestment. We want SFU to end its investment in oil, gas and coal companies and commit to a fossil free university endowment. The health, safety and moral reasons for doing so are clear and the economic case for divestment is getting stronger every day.
For the first time, the most recent IPCC report set an upper limit on total greenhouse gas emissions if we hope to avoid “dangerous” and irreversible climate change. Canada’s share of this global carbon budget of 921 gigatonnes (Gt) of carbon dioxide would depend on future climate negotiations. Marc Lee at the Canadian Centre for Policy Alternatives predicts it would fall somewhere between 4 and 24 Gt, based on either world population or gross domestic product. To put our carbon budget into perspective, Canada’s proven and probable reserves of oil, gas and coal hold 174 Gt of carbon pollution! This budget means over four-fifths of Canada’s proven-plus-probable reserves of fossil fuels need to stay in the ground. Even the conservative International Energy Agency warns that two-thirds of proven fossil fuel reserves must remain unburned prior to 2050 if we hope to avoid runaway climate change.
Marc Lee writes that “this math should alarm institutional investors, and pension funds in particular – because stock market valuations are premised on fossil-fuel-producing companies extracting those resources.”
SFU and the “Carbon Bubble”
More banks, investors, and advisors are recognizing this math. HSBC published a report that found “unburnable carbon” could reduce the market value of major fossil fuel companies by up to 60%. The City of Seattle just held a major forum on fossil fuel divestment, following their own commitment to go fossil free. In a letter urging the President of Harvard to divest, Seattle’s Mayor wrote that the “valuation [of fossil fuel companies] is based almost entirely on their carbon reserves – reserves that must remain untapped for the sake of our climate and our future. It’s wrong to wreck the planet, and it’s wrong to profit from the business model that is driving that wreckage.”
I agree. So why was SFU not among the 70 institutional investors representing over $3 trillion in assets that recently asked fossil fuel companies to examine and disclose their exposure to this “carbon bubble”?
Risky Investments in Bad Behaviour
In an interview with the Peak this summer, SFU’s Vice-President Finance and Administration Pat Hibbits said SFU is not considering fossil fuel divestment. “That’s not how it works,” she said, adding “companies that have too much risk or bad behaviour aren’t going to be part of our investments anyway, so that’s the filter we use.”
I suggest that fossil fuel firms have indeed demonstrated bad behaviour through deadly operational negligence, carbon pollution, daily disasters, and the corruption of our democracy and media. And as more and more institutional and individual investors are discovering each day, climate change means there is simply too much risk in the fossil fuel business.
If Simon Fraser University does not follow other investors in divesting, it will find itself with a portfolio of financially worthless fossil fuel and pipeline assets. This would jeopardize its academic mission and its research and education on climate change, clean energy and public health.
Along with the danger of a warmer world, this is why I am calling on the university to move its money out of fossils and into a future of clean energy, safe transport, and healthy communities. SFU should be in the business of studying and slowing climate change, not funding the companies that cause it.